WEBVTT - Surveillance: 2021 Outlook With BofA's Blanch 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jay Ley. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.960 Bloomberg dot com, and of course, on the Bloomberg. Francisco 0:00:28.000 --> 0:00:31.800 Blanche be Of, a head of Global Commodities and Derivatives research, 0:00:32.280 --> 0:00:35.320 joins us. What's your take on this? You've been writing 0:00:35.720 --> 0:00:39.200 about bitcoin here and there for years now, Francisco, has 0:00:39.240 --> 0:00:49.040 it now been accepted widely accepted in the institutional investment community? Um? Well, look, 0:00:48.760 --> 0:00:53.120 I think I think uh cryptocurrencies in general and bitcomming 0:00:53.159 --> 0:00:56.520 in particular, are to your earlier question, I think they're 0:00:56.520 --> 0:01:02.120 clearly they're clearly tokens, and uh tokens are token circummodities, 0:01:02.120 --> 0:01:05.600 so I wouldn't necessarily qualify them as currencies. Currencies are 0:01:05.640 --> 0:01:11.040 issued by a government. Um, Bitcoin or any any cryptocurrency 0:01:11.080 --> 0:01:15.479 can be issued by almost anyone, right, So in that sense, 0:01:15.600 --> 0:01:20.000 it's uh, it's a bit of an unusual setup, and uh, 0:01:20.280 --> 0:01:22.520 so I would qualify that. I think I think it's 0:01:22.800 --> 0:01:24.959 more of a commodity and it is a currency, UM, 0:01:25.920 --> 0:01:28.559 a crypto token The second thing I'd say is that 0:01:29.240 --> 0:01:32.480 you know, if you if you think about this, this 0:01:33.240 --> 0:01:38.560 particular construct that that bitcoin has, remember that ninety plus 0:01:38.560 --> 0:01:41.400 of the coin is is held by less than one 0:01:41.400 --> 0:01:45.240 percent of the account holders. So there's a very high 0:01:45.280 --> 0:01:50.320 concentration of the early um, of the early adopters that 0:01:50.360 --> 0:01:54.680 haven't really sold. And and again, if we think about 0:01:54.760 --> 0:01:57.000 supply and demand, you know, it's it's just one of 0:01:57.000 --> 0:02:01.920 those things that there's been a flurry of demand and 0:02:01.920 --> 0:02:05.200 and frankly not very much supply because the first of all, 0:02:05.240 --> 0:02:08.720 the supplies cat longer term and uh and and and 0:02:08.760 --> 0:02:12.440 that's been the issue. So so it's extremely volatile. I mean, 0:02:12.440 --> 0:02:15.320 I wouldn't I mean, compared it to any other commodity, 0:02:15.639 --> 0:02:18.560 the volativity of of of crypt currency is way way 0:02:18.639 --> 0:02:22.040 higher in most cases. So, Francisco, I want to ask you, 0:02:22.080 --> 0:02:23.560 what do you make though of a year where you've 0:02:23.560 --> 0:02:27.880 got Bitcoin up more than three here in and you've 0:02:27.880 --> 0:02:30.639 got gold on track to have the biggest annual advance 0:02:30.720 --> 0:02:33.800 in a decade. How do you kind of juxtaposing to 0:02:33.840 --> 0:02:38.079 you and how do you kind of make sense of that? Right? So, 0:02:38.360 --> 0:02:42.160 to me, it's it's quite straightforward. We've had of course, 0:02:42.720 --> 0:02:45.799 a flurry of liquidity that's coming to the market from 0:02:45.840 --> 0:02:49.200 the central banks, the FED spounce. It's more than doubled 0:02:49.480 --> 0:02:52.440 as well throughout the period. So naturally, when you inject 0:02:52.480 --> 0:02:57.040 so much money. Remember we were talking about currency before, right, 0:02:57.120 --> 0:03:01.040 so currency is created by governments. And when when, uh, 0:03:01.160 --> 0:03:04.360 the world's most important center bank, in the world's artist 0:03:04.440 --> 0:03:08.040 economy injects so much liquid in the financial system, all 0:03:08.480 --> 0:03:13.600 assets tend to benefit from it. Um and and that's 0:03:13.600 --> 0:03:17.800 what we've seen now if you think about airline stocks, 0:03:18.480 --> 0:03:22.880 or you think about other assets that have been severely 0:03:22.919 --> 0:03:26.040 impacted by mobility, which is really what the COVID nineteen 0:03:26.080 --> 0:03:29.080 crisis is about. Uh, they have not gone back to 0:03:29.240 --> 0:03:32.800 previous historical records, but all the asset classes that were 0:03:32.840 --> 0:03:38.119 in some way constraint the shirts and of course that's 0:03:38.160 --> 0:03:43.320 included UM commodities like gold or silver UM. And and 0:03:43.520 --> 0:03:46.880 uh it's also like I said before, it's it's impact 0:03:46.920 --> 0:03:50.840 to think about UM electric electric vehicle stocks, right. I 0:03:50.840 --> 0:03:53.280 mean those have have also taken off in a huge way. 0:03:53.440 --> 0:03:56.080 So so I think liquidity has been driving this this 0:03:56.280 --> 0:03:59.920 enormous divergence and in asset values that we've seen. Uh, 0:04:00.480 --> 0:04:02.640 because central banks with the fit of the helm. We're 0:04:02.680 --> 0:04:05.760 trying to support the economy and predicularly the financial markets. 0:04:07.720 --> 0:04:11.080 So what happened then, UM to oil? I mean, we 0:04:11.080 --> 0:04:13.480 were looking at sixty dollars Francisco at the beginning of 0:04:13.480 --> 0:04:17.440 the year, it dropped to negative forty, and now we're 0:04:17.480 --> 0:04:21.040 trading at nine. I can take the negative drop as 0:04:21.080 --> 0:04:25.880 a as a blip, UM, a giant, possibly orchestrated fat finger, 0:04:26.000 --> 0:04:30.360 But nonetheless it's a commodity priced in dollars that has 0:04:30.480 --> 0:04:37.080 dropped in value. Why well so So the oil story, 0:04:37.440 --> 0:04:39.880 as I mentioned earlier right, is very linked to the 0:04:39.920 --> 0:04:43.040 idea that COVID nineteen is a unique counter recession. Normally, 0:04:43.080 --> 0:04:47.440 recessions are cyclical in the sense that we see industry 0:04:47.800 --> 0:04:50.240 slowing down many fully and we tend to see some 0:04:50.320 --> 0:04:53.320 kind of financially band driving them. This time around, COVID 0:04:53.400 --> 0:04:57.839 nineteen just literally shut us, UM shut shut the global 0:04:57.839 --> 0:05:01.800 economy down in a meaningful way, and UM and mobility 0:05:01.839 --> 0:05:05.280 collapsed suddenly. We couldn't go anywhere. In fact, today I'm 0:05:05.640 --> 0:05:07.760 a home rather than being at the studio with you guys, 0:05:08.000 --> 0:05:12.120 as I would normally do on a on a regular day. Um. 0:05:12.120 --> 0:05:14.480 You know, I haven't. I haven't been on a plane now, 0:05:14.560 --> 0:05:16.279 I guess for the longest period of my life, I 0:05:16.279 --> 0:05:19.000 mean spring night, ten ten months now without kind of 0:05:19.000 --> 0:05:22.800 hopping on a plane. Um, so you know that that 0:05:22.920 --> 0:05:27.200 mobility is was taken down. The demand for oil by 0:05:27.200 --> 0:05:29.799 as much as thirty percent in the month of April 0:05:30.240 --> 0:05:33.480 UM and when the man felt by thirty which also 0:05:33.560 --> 0:05:36.200 probably linked you know, I think of GDP also felt 0:05:36.200 --> 0:05:41.040 about that number. Oil prices collapsed and uh, and then 0:05:41.080 --> 0:05:42.440 to your point, there was a bit of a fat 0:05:42.480 --> 0:05:47.000 finger there. But but also also at some point OPEC 0:05:47.120 --> 0:05:51.120 started to catch back production. We reopened the global economy 0:05:51.160 --> 0:05:54.200 and starting in May and June and and things picked up. 0:05:54.440 --> 0:05:56.200 But but now in the last couple of days we've 0:05:56.200 --> 0:05:58.640 gotten a little nervous again because of this new virus 0:05:58.680 --> 0:06:01.559 strain going on in the UK. Right, So anyway, okay, 0:06:01.720 --> 0:06:05.280 Francisco just got about seconds. So what's your projection? Give 0:06:05.360 --> 0:06:09.000 us a quick price target for oil. So we we 0:06:09.080 --> 0:06:12.320 see we see oil getting to sixty barrel by the 0:06:12.360 --> 0:06:14.560 second quarter, So we are we are constructed. We think 0:06:14.600 --> 0:06:17.520 the economy comes back. Obviously, we have to control this 0:06:17.880 --> 0:06:19.920 UK strain in the first In the next couple of months, 0:06:19.920 --> 0:06:22.720 so it could be a little patchy in January, but 0:06:22.760 --> 0:06:24.400 I think once we get to June, we're gonna be 0:06:24.440 --> 0:06:26.520 in a much better shape. Those vaccines are going to 0:06:26.560 --> 0:06:30.000 really help get things moving. No punting, all right, Gonna 0:06:30.080 --> 0:06:31.920 leave it on that note. Francisco, thank you so much. 0:06:31.920 --> 0:06:34.600 Have a great and safe new year. Francisco blant He 0:06:34.800 --> 0:06:37.960 is bake of America ahead of global commodities and derivatives research. 0:06:38.279 --> 0:06:49.640 Joining us here, Lara Ray, Let's bring her in right now, 0:06:50.400 --> 0:06:53.880 FS Investments Chief US Economists And let me start Lara 0:06:53.960 --> 0:06:58.200 with the Devil's advocate with the other side of this um. 0:06:58.240 --> 0:07:01.799 At what point does the US spend too much money? 0:07:01.800 --> 0:07:04.839 At what point do uh does the US take on 0:07:04.960 --> 0:07:09.520 too much debt? Because there isn't really a magic money tree, right, 0:07:09.640 --> 0:07:12.720 I mean, at some point you just can't keep handing 0:07:12.760 --> 0:07:17.040 out checks to American citizens. Well, I think if we've 0:07:17.160 --> 0:07:20.160 seen anything. Instead, if we wait too long and we 0:07:20.240 --> 0:07:24.640 wait until the economy is really you know, experiencings, it's 0:07:24.880 --> 0:07:29.160 a really cataclysmic disruption that we then when we're when 0:07:29.160 --> 0:07:33.800 we're performing legislation under triage, we can at that point 0:07:34.280 --> 0:07:37.680 do too much or be I think less targeted. The 0:07:37.760 --> 0:07:40.880 real point is that if you can enact legislation earlier, 0:07:41.240 --> 0:07:43.360 you can afford to be more thoughtful and you can 0:07:43.400 --> 0:07:46.320 be more targeted with it, and that just diminishes the 0:07:46.360 --> 0:07:49.680 way to diminishes the need for these multi trillion dollar 0:07:50.280 --> 0:07:53.560 huge packages. I think the point that Carol made is 0:07:53.880 --> 0:07:57.240 really important, which is that you know, right now we're 0:07:57.680 --> 0:08:01.120 still we're seeing these delays that really risk I think 0:08:01.360 --> 0:08:05.160 making the need so much more inflamed. At that point, 0:08:05.720 --> 0:08:08.280 you're trying to just fill a bigger gap, it gets 0:08:08.360 --> 0:08:13.840 more expensive, So doing less earlier really gets you further. Well, 0:08:13.880 --> 0:08:15.840 and the thing is, Lara, this is all about you know, 0:08:15.880 --> 0:08:18.480 this is gonna show in the economy in terms of 0:08:18.520 --> 0:08:21.560 the economic growth figures, which are always lagging, or a 0:08:21.600 --> 0:08:23.920 lot of them are. But I mean there's another story 0:08:23.920 --> 0:08:26.280 on the Bloomberg. Millions of Americans are calling in six 0:08:26.320 --> 0:08:28.920 stunting the recovery. The whole idea is, you know, there 0:08:28.920 --> 0:08:31.840 are a lot of lost days and that plays into productivity, 0:08:31.840 --> 0:08:34.880 and that plays into economic growth. That it's even stunting that, 0:08:35.000 --> 0:08:37.480 so layer that on top you've gotta be a little 0:08:37.480 --> 0:08:41.360 bit worried about growth going forward. I think that's right, Carol, 0:08:41.440 --> 0:08:44.040 If you know, we and and here this is kind 0:08:44.040 --> 0:08:46.199 of getting deep in the weeds on the employment numbers. 0:08:46.440 --> 0:08:48.680 But you know, you look at initial claims and to 0:08:48.760 --> 0:08:52.560 your point, they've they've come down, but void relative to 0:08:52.640 --> 0:08:57.720 any other recession. They are so elevated even now months 0:08:57.800 --> 0:09:01.120 into this recession. And you add to the fact that 0:09:01.320 --> 0:09:04.640 so many people have left the labor force. We're going 0:09:04.679 --> 0:09:08.920 to get the big monthly payroll numbers next Friday, But 0:09:09.120 --> 0:09:11.800 one of the things that we don't usually pay attention 0:09:11.840 --> 0:09:15.720 to is that participation rate. All that is expressing is 0:09:15.760 --> 0:09:18.319 how many people are actually out there looking for jobs. 0:09:18.600 --> 0:09:21.120 We've seen the unemployment rate calm down to less than 0:09:21.160 --> 0:09:23.720 seven percent, but bury beneath that is the fact that 0:09:23.760 --> 0:09:28.000 an awful lot of people and probably because schools aren't open. 0:09:28.080 --> 0:09:30.280 You can think of a lot of reasons why, or 0:09:30.440 --> 0:09:33.280 people have taken their elders out of nursing homes. You 0:09:33.320 --> 0:09:36.400 can think of a lot of reasons why during this pandemic, 0:09:36.400 --> 0:09:39.280 people have decided to stop looking for work so that 0:09:39.520 --> 0:09:43.440 lower participation rate. Little things like that. You know, you 0:09:43.559 --> 0:09:46.720 cut a ten million here, ten million people there from 0:09:46.720 --> 0:09:49.320 the labor force, and when you think about what gives 0:09:49.480 --> 0:09:53.600 us growth, what gives us GDP. You know, those numbers 0:09:53.640 --> 0:09:55.800 just may not be quite as strong as a lot 0:09:55.840 --> 0:09:58.920 of people are expecting, you know, into the end of 0:09:59.760 --> 0:10:03.520 one or as we get that traction back online after 0:10:03.600 --> 0:10:07.600 the vaccine. So, Lara, do you think companies are going 0:10:07.640 --> 0:10:10.480 to hold off in terms of hiring even if they 0:10:10.520 --> 0:10:14.040 expect demand to start coming back. I just wonder how 0:10:14.080 --> 0:10:16.520 hesitant do you think companies are going to be until 0:10:16.559 --> 0:10:21.480 they really see significant demand in This is gonna be 0:10:21.559 --> 0:10:25.120 a critical thing that we're watching in those monthly payroll numbers, 0:10:25.120 --> 0:10:28.480 because what we've seen is a really big decline in 0:10:28.640 --> 0:10:33.840 temporary unemployment, but we've started to see permanent employment rising. 0:10:34.240 --> 0:10:37.320 So I think something fascinating about COVID is that it's 0:10:37.320 --> 0:10:41.480 really accelerated. So many trends that we saw prior to 0:10:41.559 --> 0:10:44.720 the pandemic, they just really accelerated rapidly, and one of 0:10:44.760 --> 0:10:47.880 them has been this difference between temporary and permanent employment. 0:10:48.360 --> 0:10:51.320 And so in a normal recession. This is not a 0:10:51.360 --> 0:10:55.640 normal recession, but in a normal recession, permanent unemployment really 0:10:55.679 --> 0:10:59.840 continues to rise throughout the recession, and it keeps rising 0:11:00.000 --> 0:11:04.280 afterwards because companies may bring back permanent or temporary. Excuse me. 0:11:04.320 --> 0:11:07.360 They may be more likely to kind of hire people 0:11:07.400 --> 0:11:11.040 temporarily temp workers filling the gaps, but they're less likely 0:11:11.080 --> 0:11:14.640 to bring on that permanent employment. So in that regard, 0:11:15.000 --> 0:11:18.520 what we're seeing now is actually playing out more in 0:11:18.559 --> 0:11:21.200 a more normal cycle, and that's troubling. You know, we 0:11:21.280 --> 0:11:24.880 really need to see companies bringing back those permanent jobs 0:11:24.880 --> 0:11:28.080 that offer households job security. That's at the end of 0:11:28.120 --> 0:11:31.800 the day. Over long cycles without stimulus checks, that's what 0:11:32.400 --> 0:11:36.760 really burnishes the household confidence of consumer competence that drives 0:11:36.760 --> 0:11:41.839 our economy. Uh. You know, the thing most troubling to 0:11:41.920 --> 0:11:46.040 me has been people close to retirement or or planning 0:11:46.040 --> 0:11:49.400 to retire now they're not getting any kind of return. 0:11:49.520 --> 0:11:51.679 And you mentioned in your note one of my favorite 0:11:51.720 --> 0:11:55.959 books from childhood, The Giving Tree. It's so depressing when 0:11:56.000 --> 0:11:59.000 it's completely cut down. Um. And you compare this to 0:11:59.040 --> 0:12:04.199 the fixed income market, for what do you see happening 0:12:04.280 --> 0:12:08.080 with the tenure for example next year? You know, so 0:12:08.160 --> 0:12:12.079 many people are looking ahead with really optimistic growth outlooks 0:12:12.080 --> 0:12:14.560 for one, and I think you know a lot of 0:12:14.600 --> 0:12:18.760 the forecasts around four percent are very very reasonable, particularly 0:12:18.800 --> 0:12:21.040 in the second half of the year if we really 0:12:21.120 --> 0:12:25.160 get the distribution of the vaccine effective. But here's the 0:12:25.200 --> 0:12:29.120 real problem, right, long term interest rates are still I think, 0:12:29.160 --> 0:12:32.800 going to be trapped at really very near these historic 0:12:32.920 --> 0:12:35.080 lows because on the other side of it, you're going 0:12:35.160 --> 0:12:38.400 to have continued quantitative easing from the Fed. You're going 0:12:38.440 --> 0:12:42.760 to have continued, I think, uncertainty about the direction of inflation. 0:12:43.679 --> 0:12:47.079 A lot of people calling for this big reflation play 0:12:47.200 --> 0:12:50.439 next year, I think are really getting out over their skis. 0:12:50.760 --> 0:12:55.439 The reality is, although you had you had, you had 0:12:55.480 --> 0:12:58.080 that to some extent now and this is really larah 0:12:58.080 --> 0:13:00.960 what the FED is trying to you and and the 0:13:00.960 --> 0:13:03.520 e c B and everyone else. This is financial repression, 0:13:03.640 --> 0:13:08.920 right because they're pushing even retirees out the risk spectrum. 0:13:09.040 --> 0:13:12.320 So to get back to my mom, you know she 0:13:12.360 --> 0:13:16.760 can't be holding fixed income right now at sixty eight. 0:13:16.800 --> 0:13:18.560 I can't remember exactly how old she has, but you 0:13:18.600 --> 0:13:21.520 know she's got to be in equities. And this is 0:13:22.280 --> 0:13:25.320 you write about the liquid courage. The Feed is enticing 0:13:25.320 --> 0:13:27.720 these people to go out there and at least in 0:13:28.640 --> 0:13:32.520 it's been thankfully a good a good move. Oh absolutely, 0:13:32.559 --> 0:13:34.880 And I think you know the point of of the 0:13:34.880 --> 0:13:37.920 the idea of the giving tree, right, this tree that 0:13:38.000 --> 0:13:42.760 was fixed income that gave us growth and income and diversification. 0:13:43.240 --> 0:13:46.040 You know throughout the decades, back when interest rates were 0:13:46.080 --> 0:13:49.840 seven percent and five percent and even four percent in 0:13:49.880 --> 0:13:53.200 the two thousand's, you know it's two thousand times we 0:13:53.280 --> 0:13:56.040 really saw that fall flat. At the height of growth 0:13:56.520 --> 0:13:59.440 that we had in two thousand seventeen eighteen, rates were 0:13:59.720 --> 0:14:02.800 two and a half percent. Know, now you're less than 0:14:02.880 --> 0:14:05.760 one percent on the tenure the Barclays bag is you know, 0:14:05.920 --> 0:14:09.080 one point to five. At the end of the day, 0:14:09.320 --> 0:14:11.120 you need more. So I think, you know, this is 0:14:11.160 --> 0:14:13.920 an asset class with trillions of dollars still in it 0:14:14.760 --> 0:14:18.120 or related to it. So investors, I think this scheme 0:14:18.160 --> 0:14:20.360 of trying to get more active around income is just 0:14:20.400 --> 0:14:23.000 going to continue trying to push further out the incomes 0:14:23.000 --> 0:14:25.760 by right, lower duration, all those things we're gonna keep 0:14:25.800 --> 0:14:28.920 going in Lara Ram, we will be talking with you, 0:14:28.960 --> 0:14:32.480 no doubt. Have a happy New year, Stay safe, Lower Ram. 0:14:32.800 --> 0:14:46.280 She has FS Investments chief US Economists. Let's see what 0:14:46.400 --> 0:14:51.320 Dr Deborah Fuller, University of Washington School of Medicine, Microbiology professor, 0:14:51.680 --> 0:14:54.640 this is her world. See what she has to say, 0:14:54.800 --> 0:14:57.440 Dr Fuller, nice to have you here with Matt and myself. 0:14:57.480 --> 0:14:59.400 When you look at the headlines that are out there 0:14:59.680 --> 0:15:02.000 on a daily basis, it's kind of hard to keep up. 0:15:02.040 --> 0:15:04.560 It's hard not to be overwhelmed by what's going on 0:15:04.640 --> 0:15:07.440 when it comes to COVID. Uh, what is top of 0:15:07.480 --> 0:15:09.840 mind for you on this Thursday morning, on this New 0:15:09.920 --> 0:15:13.800 Year's Eve. Well, the top of my mind is as 0:15:13.880 --> 0:15:16.440 quickly as the news is changing, so does the virus. 0:15:16.880 --> 0:15:19.560 As we know, this new viral variant that came out 0:15:19.800 --> 0:15:23.880 at increases transmission in the population. That's at the top 0:15:23.920 --> 0:15:27.600 of my mind, because that really does impact things like 0:15:27.680 --> 0:15:31.240 how quickly we can get to her immunity, and of 0:15:31.280 --> 0:15:34.800 course raises a concern about increasing the number of the 0:15:34.880 --> 0:15:39.119 cases in the worldwide and the burden and our hospitals. 0:15:40.760 --> 0:15:43.600 How quickly can we get to her immunity, Doctor Fuller, 0:15:43.640 --> 0:15:48.120 can you give us maybe best case um scenario, worst 0:15:48.120 --> 0:15:52.240 case scenario? Well, as I mentioned, that keeps changing her 0:15:52.280 --> 0:15:55.800 community depends on two different variables. That is the level 0:15:55.800 --> 0:15:58.440 of vaccine efficacy, which is quite high for some of 0:15:58.440 --> 0:16:01.480 these vaccines, and that's a good thing, but it also changes. 0:16:01.720 --> 0:16:04.600 It depends on the transmission rate of the virus which 0:16:04.600 --> 0:16:09.800 ship because of these mutations can undergo changes. So we've 0:16:09.840 --> 0:16:14.400 heard anything ranging from sixty to of the population will 0:16:14.440 --> 0:16:17.640 need to get vaccinated, and how quickly that happens will 0:16:17.680 --> 0:16:20.400 depend on how quickly we can roll out these vaccines 0:16:20.640 --> 0:16:24.120 and get them distributed in in addition to getting new 0:16:24.120 --> 0:16:27.800 ones license like we're seeing this this uh aster Zenica 0:16:28.080 --> 0:16:31.560 just recently just got their vaccine license in the UK. 0:16:33.840 --> 0:16:36.760 One of the other things that really worries me as 0:16:36.800 --> 0:16:39.920 someone who has had line dosease like four times, what 0:16:40.000 --> 0:16:41.880 are the long term effects or what do we know 0:16:42.040 --> 0:16:46.320 now about the long term effects of this disease. Well, 0:16:46.320 --> 0:16:49.960 there's uh, there's uh two different, two different things there 0:16:49.960 --> 0:16:52.480 in terms of long terms effects of the disease as 0:16:52.520 --> 0:16:54.560 something we're going to have to be studying for quite 0:16:54.560 --> 0:16:57.120 some time. But in terms of long term effects of 0:16:57.200 --> 0:17:00.680 the vaccine, that's a lot of new data is starting 0:17:00.680 --> 0:17:03.800 to roll out that we're seeing um as we study 0:17:03.840 --> 0:17:07.680 the vaccine further, that immunity seems to be last seeing 0:17:08.160 --> 0:17:11.359 potentially up to six months after immunization. That's as far 0:17:11.400 --> 0:17:13.359 as we've gotten so far. Hopefully it will last at 0:17:13.400 --> 0:17:16.400 least a year or more, so that when you get vaccinated, 0:17:16.480 --> 0:17:20.800 you can at least anticipate being immune to this virus 0:17:20.880 --> 0:17:24.200 for for ideally a year or more. Right because we 0:17:24.320 --> 0:17:27.080 need that because it's going to take, as we know 0:17:27.320 --> 0:17:29.760 Dr Fuller, a long time for everyone to get vaccine, 0:17:29.800 --> 0:17:32.159 and right now we heard from president like Joe Biden, 0:17:32.240 --> 0:17:34.120 he's worried that it could take years at the current 0:17:34.160 --> 0:17:37.040 pace that we are, So we need that. Having said that, 0:17:37.080 --> 0:17:38.600 I want to go back to the variant because that's 0:17:38.600 --> 0:17:40.840 the one thing that just kind of unnerves me every morning. 0:17:41.040 --> 0:17:44.159 Could we get to a variant that doesn't respond to 0:17:44.200 --> 0:17:49.040 the current rounds of vaccines. Well, if a virus can, 0:17:49.040 --> 0:17:51.120 it will That's something I learned a long time ago 0:17:51.160 --> 0:17:54.480 when I was studying virology. Uh, it is quite possible 0:17:54.600 --> 0:17:58.720 it could attain mutations to be resistant to our vaccines, 0:17:58.800 --> 0:18:01.480 but we don't anticipate that would be easy for the 0:18:01.560 --> 0:18:05.200 virus to do because the vaccines were designed with this 0:18:05.400 --> 0:18:08.760 in mind, with the fact that viruses do undergo mutations, 0:18:08.880 --> 0:18:11.159 and so it will be very difficult for this virus 0:18:11.240 --> 0:18:14.399 to get the number and the right types of mutations 0:18:14.440 --> 0:18:17.920 to be able to invade vaccine immunity with that set 0:18:18.040 --> 0:18:20.159 is possible. And one of the good things about the 0:18:20.200 --> 0:18:23.480 types of vaccines were developing here, the RNA vaccines and 0:18:23.520 --> 0:18:27.639 now these add no virus based vaccines are very quick 0:18:27.720 --> 0:18:31.120 to update if if needed, if a new variant comes 0:18:31.119 --> 0:18:34.960 out that is resistant to our vaccine induced community. So 0:18:35.000 --> 0:18:36.719 I have to say, there's a story. Um. We were 0:18:36.760 --> 0:18:38.600 talking about it in the break before we got going 0:18:38.680 --> 0:18:42.119 you um, me and Matt, and it's saying it's by 0:18:42.160 --> 0:18:44.520 our Bloomberg News team China, making it harder to solve 0:18:44.520 --> 0:18:47.879 the mystery of where COVID began. How important is it 0:18:47.920 --> 0:18:53.560 that we understand where this COVID nineteen virus specifically came from, 0:18:53.600 --> 0:18:55.639 to make sure that we truly understand it and can 0:18:55.720 --> 0:18:58.400 kind of plan for others to come because others will 0:18:58.440 --> 0:19:03.720 come right at absolutely UH. This is something about viruses. 0:19:03.800 --> 0:19:07.040 They they do transmit. One of the most common ways 0:19:07.040 --> 0:19:11.000 that pandemics will start is a transmission from UH an 0:19:11.040 --> 0:19:16.680 animal reservoir, from particular animal into humans. And understanding how 0:19:16.720 --> 0:19:20.520 that happened that something that scientists will continue to studying. 0:19:20.640 --> 0:19:23.880 We're still picking at that, improbing at it because it's 0:19:23.960 --> 0:19:27.080 so important UH to learn about that to be able 0:19:27.160 --> 0:19:31.119 to hopefully predict the next one and stop it before 0:19:31.119 --> 0:19:32.920 it gets to this point. Dr Fuller, one of the 0:19:32.920 --> 0:19:35.840 conversations I'm having with everyone in my world is, Listen, 0:19:35.920 --> 0:19:38.119 I'm just exhausted by this year. I know I have 0:19:38.200 --> 0:19:40.320 to be good because we're we can kind of see 0:19:40.320 --> 0:19:42.600 the finish line. Having said that, it's still going to 0:19:42.640 --> 0:19:46.120 be probably a couple of rough months in terms of 0:19:46.480 --> 0:19:49.120 our economy still being shut down. What do we need 0:19:49.160 --> 0:19:51.960 to remember as we move forward, more people get the vaccine, 0:19:52.440 --> 0:19:55.359 those basic things like social distancing, masking, that's gonna be 0:19:55.400 --> 0:19:58.040 with us for a while. That is going to be 0:19:58.080 --> 0:20:01.119 with us for a while. But hopefully with these vaccines 0:20:01.160 --> 0:20:04.679 coming out, we're going to start to progressively see an impact, 0:20:04.800 --> 0:20:08.800 hopefully and reducing the number of hospitalizations. We might see 0:20:08.840 --> 0:20:12.680 that earlier on, even as it takes time to distribute 0:20:12.720 --> 0:20:16.080 these vaccines and get that into enough people, and during 0:20:16.119 --> 0:20:18.760 that time we all have to work together. This is 0:20:18.920 --> 0:20:22.040 now in the hands of the people of the population, 0:20:22.520 --> 0:20:24.399 each and every one of us. We need to do 0:20:24.480 --> 0:20:28.359 our part in getting vaccinated and and uh keeping to 0:20:28.520 --> 0:20:33.000 the practices, the social discipline and the masking UH to 0:20:33.000 --> 0:20:35.359 to get this under control. Yeah, if I think about 0:20:35.359 --> 0:20:37.359 COVID and this year. I think one word that comes 0:20:37.359 --> 0:20:39.440 to mind over and over again is all about community. 0:20:39.480 --> 0:20:40.960 It's not you know, you've really got to think about 0:20:41.000 --> 0:20:44.159 those around you, your community in terms of getting to 0:20:44.240 --> 0:20:47.160 a post COVID world. Dr Fuller, thank you so much. 0:20:47.200 --> 0:20:49.760 Have a good new year. Dr Deborah Fuller, University of 0:20:49.760 --> 0:21:02.679 Washington School of Medicine, Microbiology professor, joining us now to 0:21:02.720 --> 0:21:04.840 talk about all of this in the future relationship with 0:21:04.920 --> 0:21:08.359 the US and the UK's Karen Piers, she's UK Ambassador 0:21:08.359 --> 0:21:11.600 to the US. Ambassador Peers, thank you so much for 0:21:11.640 --> 0:21:13.880 giving us a bit of your precious time, Ambassador. When 0:21:13.880 --> 0:21:18.320 you look at what comes to with the President Trump 0:21:18.400 --> 0:21:20.679 now out of the White House, does it mean that 0:21:20.760 --> 0:21:24.040 it's less likely for the UK to to get a 0:21:24.080 --> 0:21:26.400 quick deal with the US. Well, I don't want to 0:21:26.480 --> 0:21:31.840 be presumptuous about the Biden administration's policies and priorities, but 0:21:32.000 --> 0:21:34.639 we believe this deal can be done. It can be 0:21:34.680 --> 0:21:38.320 done in twenty twenty one. That said, we don't want 0:21:38.320 --> 0:21:41.080 to set a hard deadline. Much more important to get 0:21:41.119 --> 0:21:45.080 a good deal with with lots of good content. It is. 0:21:45.160 --> 0:21:47.240 It is a good deal. It's a bit spoke deal. 0:21:47.400 --> 0:21:51.600 It wouldn't take too much bandwidth to get it through Congress, 0:21:52.119 --> 0:21:55.080 and we'd be delighted to work with the Biden administration 0:21:55.560 --> 0:21:59.200 if there were particular angles. Some people have mentioned labor, 0:21:59.480 --> 0:22:02.399 some people Paul have mentioned climate that they would like 0:22:02.520 --> 0:22:05.959 to see included. But it is an interesting deal that's 0:22:05.960 --> 0:22:09.680 for the first time. I think we'll have digital commerce 0:22:10.320 --> 0:22:14.040 as as part of its its content, and that's given 0:22:14.040 --> 0:22:17.160 where we are. What would be the UK priorities for 0:22:17.200 --> 0:22:19.359 a US deal, for a deal with the United States 0:22:19.400 --> 0:22:23.240 of America on trade. Well, as I say, we've put 0:22:23.280 --> 0:22:27.200 a lot of effort into what making this deal concentrate 0:22:27.240 --> 0:22:30.680 on digital commerce, that's the way of the future. We've 0:22:30.720 --> 0:22:33.400 also put a lot of effort into small and medium 0:22:33.400 --> 0:22:37.680 sized enterprises. Both our countries depend very much on that 0:22:37.720 --> 0:22:41.119 type of business. But I think that sector is also 0:22:41.240 --> 0:22:45.680 pretty crucial for COVID recovery, and another reason to do 0:22:45.720 --> 0:22:48.600 the deal would in fact be that COVID recovery. We 0:22:48.640 --> 0:22:52.640 want to send an early signal in one of our 0:22:52.680 --> 0:22:56.960 confidence in economic recovery across the globe and particularly in 0:22:56.960 --> 0:22:59.840 the UK and the US. Have you been talking to 0:23:00.000 --> 0:23:04.600 a Biden team already, Um, not directly. The transition team 0:23:04.680 --> 0:23:08.480 have a dictum of one president at a time. They've 0:23:08.480 --> 0:23:10.280 made it very clear they don't want to talk to 0:23:10.320 --> 0:23:13.480 foreign governments, and of course we respect that. And for 0:23:13.520 --> 0:23:17.560 all the Americans who have been nominated for cabinet posts, 0:23:17.600 --> 0:23:20.440 they of course need Senate confirmation and so we would 0:23:20.480 --> 0:23:22.600 not be able to to talk to them, and that's fine. 0:23:23.200 --> 0:23:28.440 That's a standard way that American administrations operate. Instead, We've 0:23:28.440 --> 0:23:30.720 talked to a lot of people around the Biden team, 0:23:31.200 --> 0:23:33.200 and we talk a lot to people on the Hill 0:23:33.800 --> 0:23:36.280 of both parties, and we do find a lot. I 0:23:36.320 --> 0:23:38.679 find as I go on the hill, I get a 0:23:38.720 --> 0:23:42.040